How to Evaluate Corporate Finance Project

Before Investing in the Company or before evaluating a Financial Project one must do his home Work

Here are the certain questions for which answer must be sought before putting your valuable asset i.e money into any New/ existing brown field project.

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Techniques of Financial Statement Analysis

Business

It is an interrelated system of financial resources movement that is activated by the management decisions.

Management                                                          

It is the art of asking significance questions. The process management is a series of economic choices that activates movement of financial resources connected with business.

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Franchising

Franchising

 A marketing system revolving around a two-party agreement, whereby the franchisee conducts business according to the terms specified by the franchisor 

 Franchisee

   An entrepreneur whose power is limited by a contractual agreement with a franchisor

Franchisor

The party in the franchise contract that specifies the methods to be followed and the terms to be met by the other party 

The 20 Fastest-Growing Franchises in 2003

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Measuring Investments (Part-2)

The Working Capital Effect

Ø  Intuitively, money invested in inventory or in accounts receivable cannot be used elsewhere. It, thus, represents a drain on cash flows. To the degree that some of these investments can be financed using suppliers credit (accounts payable) the cash flow drain is reduced. . Investments in working capital are thus cash outflows

1.      Any increase in working capital reduces cash flows in that year

2.      Any decrease in working capital increases cash flows in that year

3.      To provide closure, working capital investments need to be salvaged at the end of the project life

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